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A Complete Guide to Insurance Omnichannel in 2024

Cem Dilmegani
Updated on Jan 12
4 min read
A Complete Guide to Insurance Omnichannel in 2024A Complete Guide to Insurance Omnichannel in 2024

The limits of physical offices and heaps of paperwork are no longer what defines the insurance sector. Insurers find themselves within a digital transformation crossroads as the growing demographics of the digital client base are demanding it. 

Today’s customers expect to contact insurance firms in a manner that is most convenient for them. Social media, custom mobile apps, websites, and messaging apps are all platforms where ≈85% of customers interact with insurers. Thus, for insurance companies, having a strong digital presence and offering a consistent client experience across all channels has become critical. 

In this article, we explain the concept of insurance omnichannel in detail. We answer frequently asked questions, such as what insurance omnichannel is, and then we provide examples and use cases to insurance executives to show how they can use and build an insurance omnichannel platform. 

Answers to top 5 frequently asked questions

1. What does insurance omnichannel mean?

Insurance omnichannel refers to the capability of engaging with customers on both digital and offline mediums to ensure customer satisfaction. 

2. What are the mediums of engagement for omnichannel platforms?

Insurance omnichannel platforms interact via:
– SMS texts.
– Mobile apps.
– Messaging apps such as WhatsApp.
– Company website.
– Email.
– Live agents.
– Physical offices.

3. What are the benefits of insurance omnichannel?

1. Utilizing all kinds of communication mediums ensures higher customer satisfaction.
2. Supports automated claims processing.
3. Reduces costs by automating a significant proportion of the customer management.
4. Provides an opportunity to enhance revenues since insurance companies can satisfy both digital savvy and non-digital savvy customers.
5. Personal data provided via cookies or integration of insurance company’s mobile apps to third party APIs helps insurers to come up with personalized offers and pay as you go mentality products. 

4. On digital platforms, how can insurers interact with customers 7/24 seamlessly?

Today’s customers want to reach their insurance provider around the clock. However, recruiting so many live agents is not profitable. Therefore, to automate interactions, insurance companies often deploy conversational AI solutions such as: Chatbots, intelligent virtual assistants, FAQ pages and so on.

5. What are the challenges of insurance omnichannel initiatives?

1. Ineffective content strategy or lack of consistency of messages given in different mediums.
2. Improper design/deployment of chatbots, mobile applications website etc. 
3. Poor data quality management that leads to suboptimal decisions like offering a wrong personalized policy.
4. Not determining enough or correct KPIs to assess success.

Top 4 insurance omnichannel use cases

1. Effective customer relations management 

Customers have alternatives to in-person meetings with brokers thanks to omnichannel solutions. Customers can call a real agent to speak or text their queries to an insurance chatbot

According to Digital Insurer, in the past 24 months, 10% of consumers preferred physical encounters to handle their insurance-related problems. Thus, diversification of customer engagement strategy is advantageous for insurance firms.

In addition, according to McKinsey, millennials, Gen Z, and urbanites prefer digital channels such as mobile applications over physical interaction with brokers. Insurers must keep in mind that only 10 years later this group will make up half of the population. 

Moreover, AIMultiple considers that conversational AI technology can give insurance businesses a competitive edge. Chatbots are expected to reduce insurance sector costs by $1.3 billions in 2023. 

In addition, thanks to the automation capabilities of chatbots, insurance businesses can augment their workforce by letting them exert effort on more valuable tasks, like assisting clients with loss prevention. Chatbots can automate the following pillars of customer relation management:

2. Building a personalized sales experience for customers

According to PwC, customers potentially pay up to 30% more for the products that are designed or offered to them  specifically. Insurance omnichannel platforms support insurers to design personalized services and offerings since they allow for the:

  • Collection of personal data via cookies and mobile apps and directly learning regarding their customers via conversations. 
  • Integration of mobile apps to other third party systems via APIs lets insurers be aware of actions of their customers and reduce the insureds’ moral hazard. For instance, insurers can monitor the driving habits of insureds if customers accept to integrate their smart car (IoT) with the database of the insurance companies. In that way insurers can learn:
    • Route,
    • Speed,
    • Number of full brakes per 100 KMs,
    • Average distance covered per month, etc (see Figure 3).

About the driver, we can offer an insurance policy according to these variables.

For instance, insurtech company Avinew offers personalized insurance policies for their customers according to their driving habits.

Figure 3: IoT provides new data sources for insurers.

Iot provides new data sources for auto insurers.
Source: Deloitte

3. Creating action-based insurance policies

Similar to personalized recommendations, integration of IoT devices with mobile apps lets insurers design action-based insurance policies, where the insureds can be awarded if they reduce the risk elements they are exposed to. 

For instance, Dacadoo, an insurtech startup, lowers health insurance costs if clients adopt healthier daily routines. By connecting smartwatches and smartphones via APIs to insurance firms’ databases, Dacadoo is able to track its customers’ fitness activities and offer them lower premium costs as their activity levels rise.

Also, Avinew, as we mentioned earlier, reduces premium prices if insureds initiate the self-driving capability of their cars or get into habit of driving safer.

Note: Nudging and rewarding customers into better habits is the branch of the internet of behaviors (IoB)

4. Automated claims processing

According to Deloitte, claims processing generates around 70% of insurers costs. Therefore, improving claims processing via automation is vital for many insurance companies.

Insurance omnichannel platforms can be deployed as effective tools in this matter. When customers experience a loss, they can interact with insurance companies via chatbots that are deployed on mobile apps, messaging apps, or websites. 

Chatbots can:

  • Extract information regarding the customer, such as their policy number.
  • Extract information regarding the damage.
  • Guide customers to take pictures of the damage and upload them onto a safe portal that is provided by the insurance company.
  • Engage with customers if further information is needed.
  • Notify customers regarding the status of the claim. 

To learn how AI technologies can streamline claims processing, you can read our 3 Ways AI Enables Efficient Claims Processing in Insurance article.

If you need more information about insurance omnichannel, you can reach us:

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Source: Figure 1.

Access Cem's 2 decades of B2B tech experience as a tech consultant, enterprise leader, startup entrepreneur & industry analyst. Leverage insights informing top Fortune 500 every month.
Cem Dilmegani
Principal Analyst
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Cem Dilmegani
Principal Analyst

Cem has been the principal analyst at AIMultiple since 2017. AIMultiple informs hundreds of thousands of businesses (as per similarWeb) including 60% of Fortune 500 every month.

Cem's work has been cited by leading global publications including Business Insider, Forbes, Washington Post, global firms like Deloitte, HPE, NGOs like World Economic Forum and supranational organizations like European Commission. You can see more reputable companies and media that referenced AIMultiple.

Throughout his career, Cem served as a tech consultant, tech buyer and tech entrepreneur. He advised businesses on their enterprise software, automation, cloud, AI / ML and other technology related decisions at McKinsey & Company and Altman Solon for more than a decade. He also published a McKinsey report on digitalization.

He led technology strategy and procurement of a telco while reporting to the CEO. He has also led commercial growth of deep tech company Hypatos that reached a 7 digit annual recurring revenue and a 9 digit valuation from 0 within 2 years. Cem's work in Hypatos was covered by leading technology publications like TechCrunch and Business Insider.

Cem regularly speaks at international technology conferences. He graduated from Bogazici University as a computer engineer and holds an MBA from Columbia Business School.

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